What is the difference between large cap and blue-chip fund? (2024)

What is the difference between large cap and blue-chip fund?

Blue-chip funds, which focus on solid, financially strong corporations, give consistent and predictable returns, making them ideal for long-term investment strategies. Large cap funds and index funds, on the other hand, provide growth potential by investing in established companies that are publicly traded.

Is blue-chip the same as large-cap?

Stocks that are considered blue-chip stocks generally have these things in common: Large market capitalization. Market cap is a measure of the size and value of a company. Blue-chip stocks are often large-cap stocks, which typically means they have a market valuation of $10 billion or more.

What is a bluechip fund?

What is a Blue Chip Fund? A blue chip fund invests in stocks / shares of well-established companies with credible track records of financial performance that includes among other criteria - a steady payout of dividends and profitability over the years.

Which is better blue-chip or small-cap?

Small-caps are volatile and, in the short term, may not give you returns. With small-cap stocks, you need to have a long investment horizon. Bluechips are a good investment even if you have a mid-term investment horizon.

Is it better to invest in large-cap or index fund?

Index funds have a lower expense ratio as it involves less fund management discretion. It ranges between 0-2%. Large cap funds have a higher expense ratio, which can go up to 2.5% because the fund manager actively manages the portfolio. It charges its fund management fees through expense ratio.

Is it good to invest in bluechip fund?

Investing in Blue Chip Stocks or Funds is generally considered safer than many other investment options due to the stability of these established companies. However, no investment is entirely risk-free, and it's essential to assess your risk tolerance and diversify your portfolio to manage risk effectively.

Which is better index fund or bluechip fund?

Considering the investing strategies adopted by large-cap funds and index funds, the large-cap funds stay exposed to the unsystematic risk. In contrast, the investors may mitigate the unsystematic risk for their investment portfolio with index funds on account of passive investing strategies for such funds.

Is blue chip fund a large cap fund?

Examples of such large-cap funds include Axis Bluechip Fund, SBI Bluechip Fund, ICICI Prudential Bluechip Fund, etc. Similarly, all bluechip funds are actively managed. They invest in the top 100 companies by market cap.

Who should invest in bluechip funds?

Owing to their market goodwill and credibility, blue-chip shares in India come with a low-risk factor. The low-risk burden further makes them suitable for risk-averse and conservative investors.

Which bluechip fund is best?

Which is better to invest large-cap mid-cap or small-cap?

Return on Investment: Large-cap stocks are known to provide stable earnings and steady returns. While mid-cap stocks provide average returns and these returns are usually better than the returns by large-cap stocks. Small-cap stocks may be the riskiest, however, they provide the most stellar returns.

Why small-cap funds are best?

High Growth Aspirations: Small-cap stocks have the potential for rapid growth as they invest in early-stage companies. So, if you want to earn high growth and accept higher volatility, you can go with small-cap funds.

Is large-cap safer than mid-cap?

Large-cap funds are less risky than small and mid-cap funds. Small and mid-cap funds have higher growth potential than large-cap funds. Large-cap funds are good for conservative investors. Mid and small-cap funds are suitable for medium-risk takers to aggressive investors.

How long should I invest in large-cap funds?

Since these schemes invest in financially strong large cap companies, they can withstand a slowdown in the markets. However, the returns are lower compared to mid-cap or small-cap funds. In the long term (around five to seven years), these funds tend to offer good capital appreciation.

Who should invest in large-cap funds?

Long Term Investment

Large cap mutual funds are known to provide good returns only in the long term. Therefore, these funds will be most suitable only to the investors who seek to stay invested for the long term.

Why is it called blue-chip?

Key Takeaways. Blue chip companies are stable, profitable companies that are seen as safe investments in their industries. The term "blue chip" comes from the game of poker, where blue chips are the highest-value pieces. A company must be well-known, well-established, and well-capitalized to be a blue chip.

What is the average return on a blue-chip mutual fund?

What is the average return on blue-chip stocks?

How do I know which index fund is best?

The best equity index fund is the ones that track the index as closely as possible. Ideally there should not be any difference between the index and the fund return but practically, there would be a slight deviation based on the time of tracking, weightage in the stock invested or rebalanced.

Is it better to invest in target fund or index fund?

Key Takeaways. Index funds offer more choices and lower costs, while a target-date fund is an easy way to invest for retirement without worrying about asset allocations. Index funds include passively-managed exchange-traded funds (ETFs) and mutual funds that track specific indexes.

Which index fund pays the most?

Which is the rank 1 mutual fund?

Should I only invest in large cap funds?

It makes sense, then, that many investors have a huge chunk of their portfolio in large-caps. But it may make sense to branch out to smaller stocks, too, experts say. That's because small- and midsize-company stocks have two important factors working in their favor.

Which mutual fund has the highest return in the last 5 years?

Why would someone not want to invest in blue chip stocks?

Typically, blue chips demonstrate a history of exceptional performance and attractive returns for generations of investors. That's why they can be an excellent addition to a portfolio (depending on your investment goals and style). Yet, they're not immune to market downturns and economic upheaval.